Shipping Containers Stocks Affected by Tarriffs

This passed holiday season the demand for Chinese products was on the rise for Americans everywhere. Ports all over the west coast were flooded with containers carrying all sorts of Chinese made products. Retailers like Sharp, Steve Madden and Hitachi who all have factories in China were predicting December, 2018 to be the biggest ever in the retail sector.

This surplus of shipping containers flooding the U.S. shore is not due to just a demand for consumer goods but mostly because of political moves.  Starting January 1st of 2019 new tariffs came into affect that included a 25% tax on Chinese imports affecting over 200 billion worth of goods that come into the country. One third of shipping containers imported will be affected with the tariff, just to show how big of a role Chinese imports represent to the U.S. economy.

The effects of the new tariff is retailers trying to squeeze in as many shipping containers full of their products over to the states before the deadline. The ports were operating at full capacity over the holiday season, but a significant drop occurred after Jan 1st 2019. The port of Los Angeles alone saw a quarter of their shipping container imports affected over the period. Though a lot can change with the current political climate, it demonstrates the impact it has on global trade and how shipping containers play a role in delivering everyday goods.

The flow on effect of the surplus saw a drop in new container prices during Q1 of 2019, though with the increasing steel price in China container prices are expected to rise again by Q2, 2019.

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